Things are getting worse for Digital Currency Group (DCG). It may be compelled to sell its cryptocurrency publication CoinDesk, according to reports.
CNBC reported on January 18 that CoinDesk had hired investment bank Lazard. The Digital Currency Group-owned store is considering a full or partial sale.
CEO Kevin Worth stated in an emailed statement, “during the last few months, we have received multiple inbound indications of interest in CoinDesk.”
The website was founded in 2013 and published the first report about FTX’s issues and questionable balance sheet. Furthermore, according to the WSJ, DCG paid $500,000 for the media company in 2016.
The final demise of the Sam Bankman-Fried crypto business has wreaked havoc on Barry Silbert’s Digital Currency Group. Grayscale, a digital asset management, is also a subsidiary of the organisation.
Lazard, a financial consulting and asset management firm, will work with the media company to investigate “different possibilities to attract growth capital to the CoinDesk business, which may include a partial or whole sale.”
The failure of FTX exacerbated DCG’s troubles. Its crypto lending subsidiary, Genesis, is on the edge of bankruptcy as a result of hazardous loan exposure. This has had an effect on the cryptocurrency exchange Gemini, which had $900 million in customer cash tied up with its yield partner Genesis.
CEO Barry Silbert stated in a letter to shareholders earlier this month that DCG owes Genesis Capital $447.5 million and 4,550 BTC. The loan will be paid off in May 2023.
DCG is also a shareholder in Grayscale’s Bitcoin Trust (GBTC). Since March 2021, the company has reportedly purchased $722 million in GBTC. The trust is now trading at a -40% discount to its net asset value.
DCG informed shareholders on January 18 that company was suspending quarterly payouts in order to conserve finances. Furthermore, the corporation closed its wealth management unit earlier this month and laid off employees.
Today’s crypto markets are in decline, with a 3.9% drop in overall market value. As a result, the amount has fallen back below $1 trillion.
As a result, at the time of writing, all of the majors are in the red. Bitcoin fell 2.5% on the day, falling to $20,710. Meanwhile, Ethereum has dropped 3.8% in the last 24 hours and is currently trading at $1,519 at the time of writing.
